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Kenya wins geothermal field's energy dispute against WalAm Energy

Kevin Cheruiyot

11 July 2020

WalAm Energy had sued the government for revoking its license.

In Summary

• Attorney General Kihara Kariuki and Solicitor General Kennedy Ogeto led the team that represented the country in the case.

• The government revoked WalAm Energy’s license in October 2012 license after establishing that it had not performed its duties

The Kenya government prevailed in an ICSID international arbitration case against WalAm Energy at Washington based International Centre for Settlement of Investment Disputes.

The arbitration had been filed by the US/Canada based geothermal company called WalAm Energy Inc.

The dispute relates to Suswa geothermal fields and was filed in ICSID in February 2015 and the hearing took place in London in May 2018.

WalAM contended that the Kenyan government unlawfully revoked the Geothermal Resources Licence, hence breaching its obligations under the Geothermal Resources License and the Geothermal Resources Act, including, the unlawful expropriation and the violation of the minimum standard of treatment of foreign investors.

But the tribunal, in an award dated 10, July 2020 decided that all of WalAm's Energy Inc. claims are dismissed.

Following the decision, the tribunal said that WalAm Energy Inc. shall bear its legal fees and expenses and the entirety of the costs of the arbitration.

WalAm Energy will, therefore, pay Kenyan government Sh70, 067,637 correspondings to its share of the costs of the arbitration.

It will also reimburse 75% of the Kenyan government’s legal fees and expenses in the amount of Sh 441,082,797 and Sh27, 244,384.60.

The Tribunal’s decision gives the Ministry of Energy and the Geothermal Development Company (GDC) liberty to exploit the geothermal resources in the Suswa Geothermal fields and grow the energy capacity of Kenya.

The government revoked WalAm Energy’s license in October 2012 license after establishing that it had not performed its duties under the license and could not undertake the required exploration and exploitation work.

The Office of the Attorney General Kihara Kariuki, Solicitor General Kennedy Ogeto, Senior Deputy Solicitor General Muthoni Kimani and Deputy Solicitor General Njeri Wachira had represented the government.

The team also included Deputy Chief State Counsel Pauline Mcharo, Senior State Counsels Victoria Munyi and Charles Wamwayi, Freshfields Bruckhaus Deringer, Paris and Evans Monari and Njogu of Coulson Harney LLP.

Source: The Star

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